The amount in large corporations’ internal reserves for the first time ever topped 400 trillion yen, reaching 403.4 trillion yen in fiscal 2016. This was shown in the Finance Ministry’s statistics on corporations published on September 1.

In the last fiscal year, workers’ nominal wages increased by 3.6%. Taking into consideration the 5% price increase, real wages were still in a downward trend.

Prime Minister Abe Shinzo has reiterated that the more tax breaks corporations receive, the more money they spend for capital investment and pay hikes, and carried out corporate tax cuts ever since he made his comeback to power in 2012. The corporate tax rate has been decreased by 7.03 percentage points from 37.0% in fiscal 2012 to 29.97% in fiscal 2016.

However, in reality, the Abe government’s preferential tax measures worked to increase corporate internal reserves and failed to boost business investment and workers’ earnings.